John StephensonSurge Energy IncSGY.TOPAST TOP PICKNov 11, 2026

It's tied to the oil price. They've had great drilling results the past two years. Trades at 5x PE.

They have posted some very good results and the assets are really performing. Still has a lot of upside.

Largest position in his COIL ETF. Very good, conventional producer in Saskatchewan and Alberta. 90% oil, 10% gas. Great results with its waterflooding technology. Consistently among the most productive wells in Saskatchewan. Buying back ~5% of shares, targeting ~5% production growth. Low decline rate, long inventory life. Trades at 3.3x cashflow.

Overlooked because of its small size. Yield is 5.21%.

Off the radar. Some good-performing plays. Banner results with waterflood. Executing extremely well. Very good production results. Tremendous upside in range of 30-35%. Firing on all cylinders. Yield is 5.22%.

Continues to crunch it out quarter after quarter, year after year. Underperformer because it's just so small. Needs catalyst of institutional investors. Attractive yield of 5.1%.

You can make more $$ elsewhere. See his Top Picks.

Market cap is too small for his fund. Well run. Good wells. If you're up 50%, but you like the dividend, you can decide what you want to do with it.

See his Top Picks for a name with better inventory and just as well run.

An oil play, 88% oil with a little natural gas. Trades at a lower PE than bigger peers. They have low decline rates of 25% and has 12 years of drilling inventories. Pays around a 7-8% dividend.

We like SGY for a small cap sector income-focused stock. It is cheap, well-managed, offers a 7.43% dividend and also has some growth potential. The balance sheet is also very strong. With lower commodity prices expected, cash flow could drop in 2026, but we would still view it as a decent stock for small cap sector investors.
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Conventional oil producer in Western Canada. Despite its strong performance, symptom of there being zero care factor for Canadian small caps. For significant upside, you want to be "not too big, not too small". Unfortunately, this one is just too small. 

Not significant enough for institutions, and buying power of retail investors is not enough to get it going. Screens very well on spreadsheet math, but market dynamics mean it will struggle to attain institutional interest. Yield is just over 7%.

SGY is quite small at $510M, but the stock is very cheap. With a 10% dividend, a buyer (or privatization) could eliminate the dividend and use internal cash flow to pay for the whole company in about three years. But, that doesn't mean it will happen. Takeovers in the sector typically need to be friendly and we highly doubt management would want to sell out anywhere near the current price plus a premium. WCP, TVE might take a look. We would see a merger or a privatization as more likely than a takeover, but would not bet on this possibility.
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He sold at higher levels than current. There's no investment money flowing into the oil patch, because international investors perceive the federal government as hostile to energy. No buyers. Surge is well run, drills great wells, pays a good dividend and buys back stock.

Company too small to hit institutional radar screens. Quality company, but better options in markets. 

Well run. But it's a small cap, and that's just not where investor focus is, so sentiment is not behind it. Good exposure to heavy oil, phenomenally profitable now. Great yield of 6.9%. Strong balance sheet. Trades inexpensively.

Not a lot of interest in such a small cap. Very inexpensive, trades at significant discount. Gobs of free cashflow. A challenge to get on investors' radar screen. There needs to be a reason for investors to care. Should merge to gain economies of scale and relevance. Yield is 6.9%, very defendable. Buying back stock.